Government Agencies Publish Sudan Business Advisory, Highlighting Growing Risks
The departments of state, the treasury, commerce and labor issued an advisory concerning U.S. Businesses in Sudan, to highlight the growing risks to American interests conducting business in the country, especially with Sudanese state-owned enterprises. Recent actions undertaken by the Sudanese government and security forces could adversely impact U.S. businesses and their operations in the country and the region, according to the advisory.
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"Investing with, forming partnerships, or facilitating the expansion of SOEs and military-controlled companies in Sudan may entail reputational risks for U.S. businesses and individuals," the notice says. "Financial or technical assistance [also] risks the potential association with human rights abuses and with actors impeding the country’s democratic transformation."
In addition to the "apparent political and security risk," businesses should be aware that Sudan is also "plagued with an unconducive commercial environment for trade and investment." The U.S. has designated individuals and entities in Sudan under various sanctions authorities, including sanctions programs related to Darfur, South Sudan, the Central African Republic, Libya, Russia/Ukraine, election interference, malicious cyber-enabled activity, terrorism, and the Global Magnitsky sanctions program. OFAC "strongly encourages organizations subject to U.S. jurisdiction ... to employ an appropriately tailored risk-based approach to sanctions compliance."
Of particular note is the gold industry. The Department of Labor lists gold from Sudan as produced with child labor. The advisory warns businesses to review their supply chains and take "reasonable measures to guard against complicity in labor violations." The advisory further urges businesses engaged in the gold trade in Sudan to "adopt due diligence practices in line with the OECD Due Diligence Guidance for Responsible Supply Chains of Minerals from Conflict-Affected and High-Risk Areas and specifically, the Gold Supplement to the OECD Due Diligence Guidance."